Medicaid ACOs in New Jersey: At the Starting Line at Last

By Kate Greenwood

Cross-Posted at Health Reform Watch

Nearly three years ago, in July of 2011, Tara Adams Ragone wrote a blog post for Seton Hall Law’s Health Reform Watch blog entitled “Community Based Medicaid ACOs in New Jersey: A Signature Away”. As Professor Ragone explained, a month earlier the New Jersey legislature had passed Senate Bill 2443, which established a Medicaid accountable care organization (ACO) demonstration project, but Governor Chris Christie had not yet signed it. “It’s an exciting time for growth and innovation in the Garden State,” Professor Ragone wrote, “if we just get that signature.”

Governor Christie did go on to sign Senate Bill 2443 into law, in August of 2011, but the implementation process has been protracted. The act required the Department of Human Services to “adopt rules and regulations” that provided for oversight of the quality of care delivered to Medicaid recipients in the ACOs’ designated geographic areas and set standards for the gainsharing plans that participating ACOs must develop. The deadline for adopting the regulations was in June of 2012, but they were first issued, in draft form, in May of 2013. The final regulations were not adopted until earlier this week, one day before the proposed regulations were due to expire.

As Andrew Kitchenman reports here, with the regulations in place, the three community-based organizations that have been preparing to launch Medicaid ACOs, one in Camden, one in Trenton, and one in Newark, can finally get started. Unlike the State, they will have to move quickly; the deadline for applying to participate in the three-year demonstration is July 7th.

There is, in Kitchenman’s words, “a final piece to the puzzle”—the participation of managed care organizations (MCOs). Continue reading

#BELHP2014 Panel 2, Potential Problems and Limits of Nudges in Health Care

[Ed. Note: On Friday, May 2 and Saturday, May 3, 2014, the Petrie-Flom Center hosted its 2014 annual conference: "Behavioral Economics, Law, and Health Policy."  This is an installment in our series of live blog posts from the event; video will be available later in the summer on our website.]

By Matthew L Baum

In this next installment of today’s live-blogging of the conference (and with all of the caveats of live-blogging mentioned by my colleagues and my apologies for any errors or misrepresentations) we have Professors David Hyman (DH), Mark White (MW) and Andrea Freeman (AF) in a panel moderated by Glenn Cohen (GC) on the “Potential Problems and Limits of Nudges in Health Care”.

The panel began with DH, H. Ross & Helen Workman Chair in Law and Director of the Epstein Program in Health Law and Policy, University of Illinois College of Law, and a talk entitled, “what can PPACA teach us about behavioral law and economics” (Patient Protection and Affordable Care Act). DH began with the observation that nudges often work quite well… “unless they don’t”. While many nudges are “sticky”, i.e. they influence behavior in the way they were intended, others are “slippery”, i.e. they fail to influence behavior in the way they were intended. His talk set out to illustrate the phenomenon, and to pose two questions. The first was an empirical question: what makes a nudge sticky vs slippery? The second was philosophical: is it meaningful to talk about a “failed nudge” or when we do, do we really just mean failed marketing? He focused on an analysis of PPACA as a case study.

Continue reading

Action of Ohio Controlling Board on Medicaid Expansion

According to Professor Wilson R. Huhn of the University of Akron School of Law, the Ohio governor’s action expanding Medicaid in Ohio is valid. He writes:

On Monday, October 22, at the urging of Governor Kasich, the  Controlling Board of the Ohio Legislature voted 5-2 to accept $2.5  billion in federal funding to expand Medicaid in the State of Ohio.  Under the laws of Ohio this action was valid.

The Controlling Board is a state agency created by statute. The agency  has two principal powers: it can transfer funds and authorize purchases  by state agencies, and it can decide to accept federal funding on behalf of these agencies. Section 131.35(A)(5) of the Ohio Revised Code  states: “Controlling board authorization for a state agency to make an expenditure of  federal funds constitutes authority for the agency to participate in the federal program providing the funds ….”

Two advocacy organizations (the Buckeye Institute and the 1851 Center  for Constitutional Law) as well as several Ohio lawmakers have announced that they intend to challenge the legality of the action of the  Controlling Board. They contend that the action of the Board violates  Section 127.17 of the Ohio Revised Code, which provides that the Board  is bound by the intent of the Ohio General Assembly. The challengers  quite correctly point out that both houses of the General Assembly voted not to accept federal funding to expand Medicaid. Governor Kasich  vetoed this bill, but the challengers argue that despite the Governor’s  veto it’s clear that the General Assembly did not want the Controlling  Board to accept federal funding to expand Medicaid.

Continue reading

Maintenance of Effort in Maine

After the NFIB decision in June, Maine tried to expand Justice Roberts’ remedy to also make the “maintenance of effort” provision optional for states. Maine was unsuccessful in the First Circuit with the argument, for procedural reasons.  Prior coverage here.

The Obama Administration is sticking to the letter of the law, and announced Tuesday that it is refusing to allow cuts for Medicaid beneficiaries at or below 133% (138% after the 5% income disregard) of FPL in Maine.

Maine has not yet announced whether it will take the case back to the First Circuit. With Huberfeld & Leonard, we’ve argued at length (see esp. pp. 75-83) that Maine does not have the winning argument, in an article to be published in the BU Law Review later this month. SSRN version here. The short version is that MOE is a common tool to lock-in states during transition to a new program, was discussed in the briefing, but was not part of the coercion analysis in Justice Roberts’ plurality. The key provision was 42 USC 1396c, the Secretary’s authority to reduce some or all of the funding to non-compliant states. But we will see if Maine wants to argue the substance of this point at the First Circuit.

@koutterson

The DOMA Petition You Should Be Following

By Nicole Huberfeld

You may be thinking “DOMA? Hello, this is HEALTH LAW.”  Please stick with me for a moment.  The Supreme Court appears to be collecting petitions for certiorari regarding the Defense of Marriage Act, likely to determine which circuit’s decision is the best vehicle for considering the constitutionality of this federal law.  One such petition results from the First Circuit’s decision in Massachusetts v. Department of Health and Human Services/Hara v. Office of Personnel Management, which held that section 3 of DOMA violated the Fifth Amendment’s Equal Protection Clause.  The court reasoned that promoting marriage is not rationally related to denying federal benefits to same-sex couples, thereby avoiding the creation of a new category of suspect class.  The twist is that the state of Massachusetts also claims that section 3 of DOMA, which denies federal economic benefits to same-sex couples, exceeds Congress’s Spending Clause authority and infringes the state’s 10th Amendment rights.  While the First Circuit did not agree with the state on these points, it did incorporate federalism concerns into its Equal Protection Clause analysis by noting that states traditionally have defined marriage, therefore the federal government cannot protect the state of Massachusetts from its own definition of marriage by promoting heterosexual marriage. Continue reading

Medicaid Denials of Coverage for Prosthetic Devices: A Successful (for now) Challenge

By Leslie P. Francis

A recent Utah Court of Appeals decision is very much worth calling to the attention of those interested in access to health care and in disability rights. As financial pressures on Medicaid increase, and as Medicaid plays a increasingly important role in health reform, states are likely to consider ways of restricting services in order to manage costs. Alexander v. Choate, 469 U.S. 287 (1985), has long stood for the assumption that cutbacks in Medicaid funding are very difficult to challenge as disability discrimination.  In the near future, it will be critical for advocates on behalf of people with disabilities both to challenge this assumption and to consider other ways of arguing that funding cutbacks under the Medicaid program are legally problematic.

Conley v. Department of Health, Division of Medicaid and Health Financing, 2012 Ut. App. 274 (Sept. 27, 2012), is a challenge to the denial of benefits for “speech augmentative communication devices (SACDs)” for non-pregnant Medicaid recipients over the age of 21. These are electronic speech aids used by people with conditions such as cerebral palsy who cannot make themselves heard due to motor difficulties. The ALJ hearing the case had concluded that it was reasonable for the Utah Medicaid Program to provide these devices to persons under the age of 21 and to pregnant women, but not to others qualifying for Medicaid.  The ALJ’s reasoning was that federal regulations and case law allow state Medicaid to use a “utilization control procedure” in deciding what benefits to provide. Continue reading

Uninsured Drop, But the Challenges Continue

By Nicole Huberfeld

The Pacific Legal Foundation seems unable to face its defeat before the Court in June.  The PLF has filed a motion seeking leave to amend a complaint on behalf of a small business owner who would have the ACA declared unconstitutional based on the theory that the law was introduced in the Senate, not the House.  Article I section 7 of the Constitution commands that “All bills for raising revenue shall originate in the House….”  This plaintiff, Matt Sissel, originally filed a complaint challenging the constitutionality of the ACA as exceeding Congress’s commerce power; but, because the Court decided that the ACA is constitutional as an exercise of tax authority in part because it raises revenue, the plaintiff seeks to amend his complaint rather than allow it to be dismissed based on the decision in NFIB v. Sebelius.

It seems ironic that this novel filing made news the same day that the Census Bureau reported that the number and the percentage of uninsured Americans dropped for the first time since 2007.  The drop is largely attributed to young adults being permitted to stay on their parents’ insurance policies under new ACA requirements.  While the drop is movement in the right direction, it is hardly a victory given that nearly one in six Americans still lack health insurance coverage and the percentage of Americans on Medicaid has increased due to the ongoing effects of the Great Recession.  Nevertheless, it is a small taste of the positive outcomes that the ACA may produce if the federal government could stop defending the law and instead focus on implementing it.

Though it seems unlikely that lower federal courts will be interested in the obscure constitutional provision PLF relies on, as I have said before, the administration needs to learn from the nonchalance with which it initally treated challenges to the ACA.  The novelty or obscurity of the challenger’s theory does not correllate to failure with the Roberts Court, which has proven itself willing to accept new legal theories and willing to ignore or modify precedent.

[cross-posted from HealthLawProf Blog]